On May 30, the Fed released its results of its Senior Financial Officer Survey summarizing responses from bank officers regarding their reserve balance management strategies and practices. The survey concluded on March 31 and received responses from 96 banks, including 62 domestic banks and 34 foreign banking organizations, holding, in the aggregate, approximately three-fourths of total reserve balances in the banking system.

The Fed reported that nearly three-fourths of respondents expected their balance sheet size to remain unchanged (within plus or minus 2 percent) over the next six months, while one-fourth anticipated balance sheet growth. The Fed also received feedback on each bank’s lowest comfortable level of reserves (LCLOR) — defined as the lowest dollar level comfortably held in reserves by the bank, before taking any action to increase their reserves. Around half the respondents reported no change in their additional reserve funding above LCLOR since the last Senior Financial Officer Survey in September 2024. The Fed also asked about the Standing Repo Facility (SRF) and found that banks that are either SRF counterparties or intend to become an SRF counterparty viewed public disclosures of counterparty information as the factor most likely to discourage their institution’s participation in SRF operations.